BP Chemicals Ltd. is selling an underperforming British plastics bottle and closure molding business to Plysu plc for the token sum of £1 ($1.66).
The deal, due for completion on Jan. 5, includes plants in Leicester and Plenmeller, England.
The BP Bottles & Closures operations make PET, high density polyethylene and polypropylene bottles for the food, detergent, toiletries, noncarbonated drinks, automotive and hardware markets. The plants injection mold closures, pharmaceutical containers and accessories.
The BP processing business reported 1997 sales of £20 million ($33.2 million), and a loss of £1 million ($1.66 million). It employs 330.
``Plysu intends to retain and develop the businesses at the acquired operations and to further strengthen key customer relationships,'' Milton Keynes, England-based Plysu said in a statement. The operation's customers include Procter & Gamble Co.
Plysu added that it expects to turn around the unprofitable operation within 18 months. BP expected the Bottles & Closures result for 1998 will show a marked improvement on its 1997 figures.
Early in 1998, BP undertook major restructuring and invested £2.5 million ($4 million) in the molding business, which was part of BP Chemicals' plastics fabrications group. The group includes plastic film, primary and industrial packaging and molding in western Europe and the United States.
The acquisition takes Plysu firmly into pharmaceutical packaging, giving it a Class 100 clean room at the Leicester plant capable of molding bottles, droppers and caps. The plant can produce up to 60 million eye-dropper bottles and 40 million bottles and jars a year.
London-based BP announced it was disposing of the underperforming operations as it is ``moving in the direction of its core business.'' In seeking a buyer, BP was keen to find a purchaser willing to keep and grow the business.
In December, Plysu reported its profit for the half year to Sept. 30 rose by 12 percent to £5.4 million pounds ($8.9 million) on sales of £73 million ($121 million).